The Crazy and Profitable Origin of Ms. Pac-Man

It has been stated that imitation in the sincerest form of flattery. In the early '80s arcade market, imitation was a gold mine. According to a Time Magazine report from 1982, arcade games earned $2.8 billion in quarters in 1980, followed by $5 billion in 1981, which was almost twice the total of the entire U.S. movie industry for the same period. Competition was tough, and many of the games produced at that time were quick to capitalize on the success of their predecessors. Whether the game was an original idea or not was beside the point.

In those days, new games were hard to ignore, and the allure of something fresh was worth a quarter just to satisfy curiosity. In many eyes newer was better, so companies were churning out knockoffs and imitations as quickly as they could be produced. Most people know the iconic yellow chomping character of Pac-Man, but perhaps long forgotten (or never even acknowledged), were a plethora of copycat games like Piranha and Lock N’ Chase. For every three or four Galaga cabinets produced, there seemed to be one cobbled-together generic conversion powered by a bootleg “Gallag” circuit board. However, the tales of quarters filling the coin buckets to such capacity that a game could no longer function were true, and many operators would do all they could to accept America’s loose change.

If you were to stumble upon the website for GCC printers, you will find yourself looking at an incredibly out-dated design for a small company selling laser printers. With an expressed copyright of 2004 and a website design that looks like it was created even earlier, it is hard to tell if GCC is still in operation. (If this cutting plotter I found on Amazon is any indication, they are.) What you may not expect to learn about this mild-mannered printing company is that its history traces itself back to a couple of college kids who started a company building on the backs of arcade legends Bally/Midway and Atari, earning millions along the way.

Doug Macrae was a student at Massachusetts Institute of Technology (MIT) in Cambridge, MA, when he began operating his first coin amusement game on campus. The game was “Pioneer,” a pinball machine manufactured by D. Gottlieb and Company in 1976. The pinball machine had been his brother’s, who had placed it in his own fraternity house to much success. When Doug was given the game by his brother and put it on location in his dorm to start earning MIT students’ quarters, the profits were enough to quickly convince him to place even more games on location. Before long, Pioneer was joined by another pinball machine, Paragon, along with several new video arcade machines: Star Castle, Rip Off, Fire One, and three Missile Command games.

http://galleryszy.stevenanne.net/

The money the games earned would eventually be enough to pay off his entire tuition at one of the country’s top educational institutions. The games were immensely popular explained Doug when he spoke at CAX in 2010:

“We decided the best way to keep the quarters circulating was to change the economics. We got known on campus that if anybody ever needed change we’d give out five quarters for a dollar. We knew they were all coming back to us anyway.”

The three Missile Commands were the most popular choice by far. The game, designed by Dave Theurer and released by Atari in 1980, had players protect their cities from incoming missile attacks using buttons for each of the three defense silos and a large trackball to control their trajectory. The unique gameplay along with the tensions between the U.S. and the Soviet Union at the time no doubt increased the appeal of this Cold War thriller so much that upon their debut, each of the three machines on the MIT campus were earning $650 per week.

Although the games were popular, as was common during the “Golden Age” of arcades, the longer a game was on location, the less revenue it eventually generated. It would still be a few years before manufacturers would release “conversion kits,” which allowed an operator to simply retrofit an existing game cabinet with new hardware and artwork to become a completely different game. When profits for each of Doug’s Missile Commands slipped to just $150 a week, he knew something had to be done.

In 1981, Doug partnered with Kevin Curran to create General Computing Corp. (or GCC). The newly formed GCC, along with the talents of engineers John Tylco, Steve Golson, Mike Horowitz, and Chris Rode, quickly went to work to solve every operator’s problem of diminishing returns.

“We came up with the idea of adding features to the game. Not just speeding it up, but we wanted to add features, and we wanted to do it in a very clever way because we were concerned about copyright issues.” explains Doug.

They didn't just rip the existing Atari code, modify it, and reburn the ROMs. They created and coded an entirely new circuit board that would be mounted onto the original hardware. Operators would remove the original Missile Command ROMs, place them into the new circuit board, and circuitry would overlay the new code on top of the Atari code. The end result was “Super Missile Attack.”

After setting up an 800 number and placing ads in industry trade magazines Playmeter and Replay in May of 1981, GCC went to work building the expansion kits in the basement of a rented house using a Genrad 6502 Microprocessor emulator that cost $25K which Doug borrowed from his parents. The kits cost the young students just $30 to build, yet the asking price for their ingenuity was $295 per kit. Within 60 days, the enterprise sold nearly 1,000 units earning the new company an astounding quarter of a million dollars.

Despite their best efforts at avoiding copyright issues, it wasn't long until they were slapped with a lawsuit by Atari. Doug, Kevin, and General Computing Corp. were sued for $15 Million. According to Doug, “The issue was bigger than we thought it was.” The team had anticipated copyright infringement concerns, but failed to anticipate Atari’s other claims of “Trademark dilution and misrepresentation of origin.” The case would be played out in circuit court in the summer of 1981, but a restraining order during the proceedings meant they were not allowed to make any more kits. Fortunately, they had their eyes set on another, more popular, game.

The day GCC walked into the headquarters of Bally/Midway was the very last day that Pac-Man would be on the production line. Without another hit game on the horizon, Bally/Midway was already anticipating layoffs. While they were confident in the legality of their Super Missile Attack product, GCC was wary of further legal troubles, so once they completed development of their new expansion kit, they went straight to the competition to ask for permission to sell their new game, Crazy Otto.

Like Super Missile Attack, Crazy Otto was a new game that attached to the existing hardware of a previous title -- in this case, Pac-Man. Crazy Otto essentially looked like Pac-Man on legs, and the ghosts now appeared as monsters with antennas. It added more mazes, gave more intelligence to the monsters, and prevented “pattern play”. With no other options in the queue, Bally/Midway saw this as an answer to their dilemma.

“It was to our favor that we walked in at the right time when there was no sequel and stepped into those shoes.” - Doug Macrae

While Bally/Midway held the distribution rights for Pac-Man, they still had to get permission from NAMCO to license the Pac-Man brand. Bally/Midway would pay both NAMCO and GCC royalties for each new game produced, and Crazy Otto would become Ms. Pac-Man. Despite rumors to the contrary, NAMCO fully endorsed this pursuit. In fact, it was Masaya Nakamura, then president of NAMCO who requested the removal of the red hair originally added to the Ms. Pac-Man character, but left the bow. Ms. Pac-Man would prove to be a massive hit, selling approximately 117,000 units over the course of its production run. However, it would be Atari that would earn Doug Macrae’s General Computing Corp. its first $1 Million.

It was Atari’s legendary attorney Skip Paul who finally asked the question during their lawsuit with GCC, “Why are you doing this? What do you want?” to which Doug and GCC responded, “We want to design video games.” Skip’s answer? “Great.”

GCC would be forced to discontinue production and sales of Super Missile Attack and told to never create enhancement kits again without the manufacturer’s permission. However, GCC’s settlement terms with Atari earned them a development contract for $50K per month for two years to develop video games exclusively for Atari. This new development would bump up General Computing Corp. staffing to 75 people. That year, GCC was the largest recruiter of MIT students, more than IBM or HP.

The young and talented staff of General Computing Corp. (GCC) galleryszy.stevenanne.net/

The first two dedicated arcade games created for Atari were moderate hits, but would not come anywhere close to the giant sales numbers of Ms. Pac-Man. GCC’s first game, Quantum, was designed by Betty Ryan (Tylko) and was built off of existing Tempest software. It sold six to seven thousand units. Food Fight, a colorful and lively game pitting a kid against a angry chefs, was designed by Jonathan Hurd and enjoyed modest sales as well. With only two modest hits, and six to seven developed games that failed to make it to production, GCC soon discovered that creating original games was much more difficult that modifying existing ones.

It would be their skill in identifying and building upon the core essence of an arcade game that would bring GCC success in the home console market for Atari. GCC would be responsible for bringing several arcade games to Atari’s 2600, 5200, and 7800 systems. They would port many classic arcade titles to the new home systems including Asteroids, Battlezone, Centipede, Berzerk, and Pole Position. In fact, they even developed the entire 7800 console before Jack Tramiel (of Commodore computer fame), bought Atari in July 1984 and shelved the completed project until January of 1986.

A wall displaying a number of the video game titles developed by GCC for Atari. galleryszy.stevenanne.net/

According to Doug Macrae, Jack “made it clear he did not want our services. He did not believe in video games, he believed in home computers.“ So the Atari 7800 would sit in a warehouse for over a year along with 16 ready-to-go games just so Jack could avoid paying GCC their royalties. Ultimately, Jack would relent, and the 7800 would be released, but not before Nintendo’s own home console had an opportunity to grab hold of consumer’s attentions and wallets. Atari would never again dominate the home console market.

The arcade market would experience a tremendous crash in 1984, after which Doug Macrae would leave GCC for a number of other projects before eventually becoming CTO and head of TV Guide’s consumer electronics division. After his retirement, Doug would then serve on the board of Curt Schilling’s famed failed gaming venture -- 38 Studios. Kevin Curran is still CEO of GCC, and it appears several of the original employees of General Computing Corp. continue to work for the company founded by the two wide-eyed college students.

Reminders of the early, fast-paced days of the arcade industry still pop up every now and then as was the case when NAMCO started producing 20th anniversary Ms. Pac-Man cabinets without consulting GCC, which resulted in arbitration and payment of royalties to them. For the most part, however, General Computing Corp. transitioned itself to other forms of computing hardware, eventually settling in the printing world, where it remains today. At first glance, GCC may seem like an ordinary, perhaps boring, printer company. However, they serve to remind us of that indelible quote by Sir Isaac Newton, “If I have seen a little further it is by standing on the shoulders of giants.”

Preston Burt is the co-host of The Gameroom Junkies, an arcade and pinball podcast covering arcade and pinball arcade collections and repair. You can also follow Gameroom Junkies on Twitter and Like their Facebook page.